The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1887-12-03
MAINE SAVINGS BANKS.
TooNTINUrp FRO FIRST PAGE.l

streets. and the holders must look for the
payment of interest and principal from tax
assessed and collected against speclhc iot
of land.
upon the credit of the city and the CITY Is
empowered to use such sums as may De nee
essary to pay the maturing obligations from
the general fund, and reimburse the treas.
ury by tax assessed ana coliecteu asa 'iiiio
each specific piece of property; so that while
the payment ultimately comes from the prop
erty assessed, yet the obligation makes
guarantee binding upon the city that these
bonds shall be paid.
SAVINGS BANK MANAGEMENT.
We sometimes find in the same locality two
corporations engaged in manufacturing the
same article of merchandise
One prospers, grows rich. earns ana pays
liberal dividends and maintains high credit.
The other exists from year to yea T, It's stock 1
holders receive little benefit from It's exist
ence and its credit is never above suspicion'
The causes which produce these oppcslte re-
fact that the one has well organized board
of directors who attend to the business OF
the company, while the directors OF the otn-
er corporation neglect their duties or dele
gate its management to Il subordinate ONO
The same cause will produce similar re-
suits if applied to savings banks. II bank
has well organized board of trustees, whose
efforts are constantly employed In promoting
its welfare, it is almost certain TO enjoy hlgh
credit and to increase in prosperity.
If trustees fail to appreciate the response
bility of their office, accept 1t as an honorary
recognition, assume that the only duty II
imposes upon them is to complete the organ
ization by electing treasurer fix his salary
so low that without other resources ne must
almost go hungry, and exchange congratuia-
tions with the depositors upon the economy
exercised in the management OF their trust,
then let the creditors of such an INSTITUTION
prepare for disaster
Ii the treasurer complains at the meagre-
ness of his salary such a board would be
likely to encourage him with the re-assur-
ance that the Office to which he has been
elected gives him a standing and a credit
which will enable him to make more than his
salary frem other sources.
Such board would not be likely to COM
plain If the sofficer received deposits In
his own name and loaned them for his per-
sonal profit; nor would they be likely to no.
tice it If at times wheu his capital was in
personal business, he nsed the unemployed
funds of the bank to meet the necessities OF
his private traffic. To be sure the examiner
is liable to unexpectedly visit the bank. but
even then his credit is so we'll established
that he can send to the Office of one of his
trustees and borrow his check to meet. the
emergency of an examination Of his cash.
In time the savings bank loses its identity
and is known in the community as Mr.. AS
bank, and credulous depositors do not know
whether they are depositing in the bank or
in Mr. AS pocket. They do know that
the trustees are the leading business men OF
the town; they understand that the affairs OF
the savings bank are administered with re-
markable economy and that the treasurer Is
gentlemen of high credit.
If depositors discover that these conditions
exist in any saxings bank, they may be sure
that sooner or later its career will end In loss
and calamity.
The trustees of savings banks are recog-
nized by the statute as the ultimate govern
ing power of these institutions.
Upon them devolves the duty of selecting
honest, painstaking subordinate officers; nor
does their duty cease there
They should manifest constant and ac-
tive interest in directing and :reviewing the
work. Ii young man is employed in po-
sition of trust, it is duty they owe to the
employe, to the public and to themselves to
acquire thorough knowledge of him, both
inside and outside of the bank. They should
observe him as he is discharging his duties
at the desk or at the counter; engage him ia
him; ascertain in what direc-
ton his tastes are leading him; whether the
text books by which he is fitting himself for
bank service are standard works on banking
or Pinkert0n's Detective Series; ascertain
whether he is living within his salary; If
not, and it is the fault of extrayagant ex-
penses, discharge him; otherwise do him
justice by promptly granting an increase,
for if he cannot live with reasonable ec0n0-
my on his salary, temptation is constantly
before him.
If experience of sufficient duration has
demonstrated that a savings bank cannot be
managed so as to earn Reasonable dividends
after paying its of1iciers such salaries as VIII
afford something more than living BETTING
the position in the community where the
bank is located, and trustees should recog--
nize the fact and make final settlement of
its affairs.
The large savings banks require the undi-
vided attention OF faithful, efficient officers
to maintain their standing; the smaller in
situations whose ultimate success is yet a
problem can i'll afford less.
When trustees permit treasurer to divide
his time and talent, his natural lnterpreta-
ton of the license would be as little as pos
sible for the bank and all the rest for private
business.
This policy never tends to a successful
growth of the bank and generally results in
the downfall of both the officer and the cor
poration.
Recent defalcations in other States have
resulted in litigation through which. the, re-
sponsibility of trustees or directors has been
defined by the courts.
In passing upon this question the Supreme
Court Of Illinois declare in substance, that
there are conditions under which trustees
may be held responsible to depositors. IL
the bank should fail through the defalcation
of one of its officers which proper vigilance
on the part of the directors Nigh have pre-
vented, the latter become legally liable Tor
the deposits. This view was taken by the
lower court and afterwards confirmed by the
Supreme Court of the State.
Another decision declares that director
who ignores his duty and by failure to at
tend meetings of the board leaves the active
management of the affairs Of the corpora.
ton to other directors, is thereby guilty of
such gross negligence as will make him re-
sponsible for many of the acts, If not all that
are not positively fraudulent. of those to
whom he left such management.
The Court of Appeals of New Jersey re-
Gently held that trustee who has caused his
savings bank to lose the amount of a loan by
an unauthorized investment by reason OF de-
fective security is liable for such loss to the
bank.
1t seems to be we'll settled principle Of
law that trustee who neglects to perform
his duties, is justly chargable with the conse-
quences Of such negligence.
CUSTODY OF NEGOTIABLE ASSETS.
1t is good rule for every savings bank to
adopt by vote of the board, that the safe, or
the box in the safe deposit vault containing
the securities, shall not be opened except in
the presence of one or more trustees with
the treasurer, and that they shall remain to-
gether until it is securely closed; and 1t is
recommended that they take such other ac-
tion as may be necessary to render access to
the negotiable assets by any single officer OF
the bank, matter of impossibility.
THE RECORD.
During the past eight years, the number of
depositors in the savings banks of this State
has increased from 75,443 to lis, 229, and the
amount of deposits from S20,97S, 1902 to
SIS, SIS, 643.22.
At the commencement of 1880 their sur
plus above liabilities was S1,057, 1862. 1t
nov stands at So, 237 ,004. go.
In 1880 the amount of securities in default
was $S66,375; they are now reduced to $115,-
000
The character of their assets as whole,
has improved during the eight years to de-
gree that hardly admits of comparison.
In eight years the savings banks have paid
into the State treasury for tax on deposits,
81, COS, 127 81, and paid dividends to their de-
posit0rs amounting to $9,698, 1913.
The record speaks for itself.
No other encomum can strengthen the
claim Of the savings banks Of Maine to the
confidence of their depositors and Of the